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Bills Digest No. 50  1998-99
Regional Forest Agreements Bill 1998

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer and Copyright Details

Passage History

Date Introduced: 26 November 1998

House: House of Representatives

Portfolio: Forestry and Conservation

Commencement: On a day to be fixed by Proclamation or on the first day after 6 months from Royal Assent has elapsed, whichever is the earlier.

The Bill seeks to provide legislative support to the outcomes of Regional Forest Agreements (RFAs) entered into between the Commonwealth and States and Territories, as part implementation of the National Forest Policy Statement.

The Commonwealth Government is responsible for coordinating a national approach to both environmental and industry-development issues. It has an interest in achieving the efficient and effective management of the nation's forest resources.

History of the Bill

This Bill was originally introduced to the House of Representatives on 30 June 1998. It was read a second time on 15 July 1998 and there was substantive debate. It was resolved not to refer the Bill to the House of Representatives Standing Committee on Primary Industries, Resources and Rural and Regional Affairs. The Bill was read a third time.(1) It lapsed when Parliament was dissolved for the 1998 General Election and has now been re-introduced.

Related matters, the adequacy of the 'National Reserve System' and 'export controls' were under review by the Senate Environment, Recreation, Communications, and the Arts References Committee, as part of the Commonwealth Environment Powers inquiry, but this Inquiry has not yet been re-instated in the 39^th Parliament.

Regional Forest Agreements are included in Chapter 2, Part 4, Division 4 of the Environment Protection and Biodiversity Conservation Bill 1998, which is being considered by the Senate Environment, Communications, Information Technology and the Arts Legislation Committee, due to report in March 1999. Subdivision A excludes forestry operations permitted by Regional Forest Agreements from an approval process for environmental impact assessment procedures.

The Bill, when reintroduced on 26 November 1998, was identical to the original Bill, as was the Explanatory Memorandum, but there were substantive additions to the Second Reading Speech emphasising: ongoing revisions to RFAs already concluded in Victoria and Tasmania; consistent termination and compensation provisions to be included in all RFAs; RFAs not yet negotiated must meet the stringent definition of RFA in Clause 3; and the Government's strong commitment to industry development.(2)

National Forest Policy Statement

In 1992, the Commonwealth and the States and Territories signed the National Forest Policy Statement (NFPS). The Statement outlined agreed objectives and policies for the future of Australia's public and private forests. It provided national goals in 11 areas, which indicate the breadth of the forestry issues that need to be addressed by the Commonwealth: conservation; wood production and industry development; integrated and coordinated decision making and management; private native forests; plantations; water supply and catchment management; tourism and other economic and social opportunities; employment; workforce education and training; public awareness, education and involvement; research and development; and international responsibilities.(3)

As provided for in the NFPS, a Comprehensive Regional Assessment (CRA) is a joint assessment of all forest values by the Commonwealth and State - environmental, heritage, economic and social - leading to the establishment of a comprehensive, adequate and representative reserve system, agreements on forest management, and the signing of a Regional Forest Agreement (RFA). Where CRAs are in place, approvals for the export of woodchips for periods longer than one year may be considered, and the Commonwealth will be able to meet its legislative obligations under s. 30 of the Australian Heritage Commission Act 1975.

A Regional Forest Agreement is an agreement about the long-term management and use of forests in a particular region between the Commonwealth and a State Government. Its purpose is to reduce uncertainty, duplication and fragmentation in government decision-making by producing a durable agreement on the management and use of forests.(4)

On 22 December 1994, the then Prime Minister, the Hon Paul Keating MP, intervened to expedite the Regional Forest Agreement process and announced that a strict timetable would be developed for each Agreement, which would be developed on the basis of technical and scientific assessment of the values of all the forests.

In January 1997, the Commonwealth released details of Nationally Agreed Criteria for the Establishment of a Comprehensive, Adequate and Representative Reserve System for Forests in Australia (the so-called JANIS Report).(5) There are three broad criteria for biodiversity, old growth forests and wilderness:

• a benchmark of 15% of the pre-1750s distribution of each forest community to be protected within conservation reserves;
• retention in reserves of at least 60% of existing old growth, increasing up to 100% for rare forest community old growth; and
• protection of 90% or more, wherever practicable, of high quality wilderness.(6)

By the end of November 1997, the 'JANIS reserve criteria' had been broadened to take account of social and economic considerations'.(7)

Eleven regions were defined by the Export Control (Hardwood Wood Chips) (1996) Regulations. There have been subsequent name changes to the regions and the North Region of NSW has been split into two. In the Environment Protection and Biodiversity Conservation Bill 1998, Division 4 may require amendment as it does not name existing Regional Forest Agreements and names, in clause 41, only 9 of the 12 RFA regions. Presumably this Bill is intended to apply to all RFA regions. Note that in the case of Tasmania, the entire state is considered one region and this has management implications, which are discussed under clause 7 below.

Regional Forest Agreements

RFAs are intended to provide the basis for both future forest management and an internationally competitive and ecologically sustainable forest products industry. The agreements will provide for a comprehensive, adequate and representative (CAR) forest reserve system and will clearly identify those forest resources available for multiple use, including resources for sustainable timber harvesting.(8)

To date, RFAs have been concluded for the East Gippsland and Central Highlands regions in Victoria and the Tasmania region.(9) The process for assessment and negotiation of RFAs is currently underway for nine other regions. Refer to Table 1.

Table 1. List of 12 Regional Forest Agreements with progress towards their signing,
in likely chronological order
(Information supplied by the Department of Prime Minister and Cabinet and Environment Australia)

Need for legislation

It would appear that this Bill was necessary for two reasons, to:

• legislate to remove Commonwealth environmental assessment, national heritage and World Heritage legislative requirements over regions covered by RFAs; and
• require the Commonwealth to pay compensation if it intervenes to protect the environment in an area covered by an RFA.

Regional forest agreements are intended to be 20-year agreements with a five year review of performance, the outcomes of which will be made public. On 25 March 1997, Senator Brown proposed that the Senate note that the East Gippsland Regional Forest Agreement 'is a statement of intent only and has no legal effect'.(10) The motion was lost.

A need to legislate for compensation may have arisen as a result of concerns that the Tasmanian RFA did not in fact legally bind the Commonwealth to pay compensation to the Tasmanian Government and the forest and mineral industry, as was intended. A legal opinion to this effect was obtained by Senator Bob Brown.(11) Mr Gary Corr, in a 50-page opinion to the Greens, concluded: 'The agreement is a statement of intent only and has no legal effect'. However, the chief executive of the Forest Industry Association of Tasmania, Mr Ian Whyte, said that 'its importance to the industry remained intact'.(12)

In response to a Question on Notice from Senator Brown on 2 April 1998, as to why legislation is being prepared to give effect to RFAs if they are already legally binding, Senator the Hon Robert Hill, Minister representing the Prime Minister, responded that:

Compensation

In the interests of enhancing industry confidence in RFAs, the Commonwealth proposes that all RFAs will include positive obligations on the States to initiate compensation action on behalf of industry where a Commonwealth breach of an RFA results in a case for compensation. The Hon John Anderson MP, then Minister for Primary Industries and Energy, in a Press Statement on 30 June 1998, stated that:

The commencement of the RFA Act must occur within 6 months and one day of the Bill being granted Royal Assent. This delay is intended to permit examination of existing RFAs with regard to compensation provisions (Clause 7) to ensure consistency between RFAs. These further negotiations, foreshadowed in the Minister's second reading speech, were to begin 'as soon as possible' and the Hon Wilson Tuckey MP, Minister for Forestry and Conservation, was able to report to the Parliament on 26 November 1998 that 'we are working with the Victorian and Tasmanian Governments to include these provisions in existing RFAs in the near future'. He added that '...this process does not amount to opening renegotiation of existing RFAs'.(14) It is difficult to understand how inserting a new clause in an agreement does not amount to renegotiation. It might have been preferable for the re-examination of existing RFAs to be completed prior to the introduction of the legislation.

An earlier Bill introduced by the Hawke Government, the Forest Conservation and Development Bill 1991, which was defeated in the Senate, specifically excluded compensation being payable by the States or Commonwealth.

Removal of export controls

The Commonwealth has reduced its powers even further under the RFA process by giving an undertaking to remove controls on export woodchips from an RFA region. The Export Control (Regional Forest Agreements) Regulations of April 1997, under the Export Control Act 1982, means that a Commonwealth export licence is no longer needed to export hardwood woodchips and other unprocessed wood from an RFA region.

The Union covering the Forest and Forest Products Industry, the Construction, Forestry, Mining and Energy Union (CFMEU), has called upon the Commonwealth to maintain some of its powers of intervention. The Union believes that:

The provision of export licences used to act as a potential trigger for Environment Impact Assessment. As shown in Tasmanian Conservation Trust Inc v Minister for Resources (Gunns case) in 1994, the approval of a woodchip export licence may have a significant effect on the environment.(16) The decision to remove export controls by the Commonwealth government, as part of the RFA legislation, reduces the Commonwealth's role in environmental impact assessment.(17) However, the Government considers that the CRA process meets the requirements of an environmental assessment for the purposes of the Environment Protection (Impact of Proposals) Act 1974.

Relation to existing and proposed environmental legislation

The Bill aims to remove Commonwealth environmental legislative control, other than that of this Bill, from forestry operations in every area of Australia covered by a Regional Forest Agreement which is in force. The effect of RFA forestry operations must be disregarded for the purposes of certain sections of the:

• Australian Heritage Commission Act 1975;
• Environment Protection (Impact of Proposals) Act 1974; and the
• World Heritage Properties Conservation Act 1983.

The Environment Protection and Biodiversity Conservation Bill 1998 (at Chapter 2, Division 4, clauses 38-41, pp 40 - 43) refers to the Regional Forest Agreements Act 1998, and states that forestry operations do not need approval if they are undertaken in accordance with Regional Forest Agreements. This is consistent with the Government's stated intention to minimise its role in forest management.

Export licences have been removed as a trigger for environmental impact assessment under the proposed Environment Protection and Biodiversity Conservation Bill 1998.

As the RFA Bill may provide a legislative model for future bilateral agreements and associated legislation proposed under the Environment Protection and Biodiversity Conservation Bill 1998, these Bills should be considered in context. The possible proliferation of both Commonwealth and complementary State legislation would run counter to the Government's stated criticism of 'ad hoc' legislation by previous Governments and its concern to 'improve government processes'.(18)

Financial Impact Statement

The Explanatory Memorandum states that:

This statement is open to challenge. The Bill introduces possible substantial compensation payments by the Commonwealth which are 'payable out of money appropriated by the Parliament' (Clause 7. Subsection 3(b)). The Bill also imposes additional financial impacts including the cost of negotiations to revise existing RFAs and any additional complementary State legislation for RFAs.

Clause 3 defines certain terms contained in the Bill. An RFA is defined:

With regard to the definition of a 'comprehensive, adequate and representative reserve system' it should be noted that 'RFAs currently in force will be examined and, if necessary, revised to ensure consistency with the Act'.(19)

Clause 4 binds the Crown in right of the Commonwealth.

Clause 5 precludes any controls under the Export Control Act 1982 being applied to RFA wood sourced from an RFA region, as discussed above. The Export Control (Hardwood Wood Chips) (1996) Regulations in September 1996 were followed in May 1997, by the Export Control (Regional Forest Agreements) Regulations, under the Export Control Act 1982, which meant that a Commonwealth export licence was not needed to export hardwood woodchips and other unprocessed wood from an RFA region. This Clause provides legislative backing, which may be considered unnecessary since Regulations are already in place.

Clause 5 of the Bill also states that the effect of RFA forestry operations must be disregarded for the purposes of certain sections of the Australian Heritage Commission Act 1975, Environment Protection (Impact of Proposals) Act 1974 and the World Heritage Properties Conservation Act 1983.

The Environment Protection and Biodiversity Conservation Bill 1998, currently before the Parliament, will replace the Environment Protection (Impact of Proposals) Act 1974 and the World Heritage Properties Conservation Act 1983 but not the Australian Heritage Commission Act 1975. The RFA Bill may then require consequential amendment.

The RFA Bill has the effect of not providing protection for World Heritage areas under section 6 of the World Heritage Properties Conservation Act 1983 if an RFA is in place. In the case of the Tasmanian RFA, the protection of 'World Heritage values' is specified in the RFA itself.(20) In the case of the West Gippsland and Central Highlands RFAs, any future World Heritage nomination will be achieved from within the CAR Reserve System.

The entire State of Tasmania is classified as one region within the Tasmanian RFA, with the result that the Tasmanian Wilderness World Heritage Area is covered by this legislation. It could be argued that, when this Bill is enacted, the World Heritage Properties Conservation Act 1982 would not apply to forestry and forestry transport operations in the Tasmanian WHA. However, once the EP&BC Bill is enacted, approval for forestry operations in a World Heritage area, even if covered by an RFA, would be needed.(21)

Clause 6 provides that the termination of an RFA by the Commonwealth has no effect unless it is done in accordance with the termination provisions of the RFA in force at the time the Act commences or at the time the RFA commences, whichever is later. This is to provide a safeguard that the Commonwealth cannot agree to subsequently change termination provisions in any RFA without amendment of the Act by the Parliament. In RFAs already negotiated, termination can only occur 3 months after an intention is notified. As outlined in the Second Reading Speech:

An important modification such as this could have been included in the Bill, to permit enactment of the legislation prior to the re-visiting of existing agreements.

Clause 7 is the critical part of the Bill that ensures that the Commonwealth is liable to pay compensation to a State for a breach of an RFA by the Commonwealth. It states that:

• the Commonwealth is liable to pay compensation to a State in accordance with provisions of the relevant RFA (subclause 1); and
• the liability incurred when an RFA is in force continues even after the RFA has been terminated or expired (subclause 2).

Unlike Clause 5 which applies in relation to 'RFA wood or RFA forestry operations' (a broad definition including land clearing, land preparation and burning and transport operations as in Clause 3), Clause 7 is not similarly restricted and applies also to mining.

Note that while the East Gippsland RFA contains no compensation provision, the Central Highlands RFA and the Tasmanian RFA include compensation for mining products (95.1 (j)) as well as forestry products and road building (Attachment 1, pp 26-28).(22)

If the Tasmanian Government approved forestry operations, such as burning, adjacent to the WHA, which compromised WH values, and the Commonwealth intervened to stop such forestry operations, then the Commonwealth might be liable to pay compensation to the State. Alternatively, the cost of compensation payable by the Commonwealth might be used as a justification for not intervening to stop the forestry operations.

Clause 8 requires the Minister to publish information about RFAs.

This Bill attempts to provide legislative certainty to the part implementation of the National Forest Policy Statement through the process of Regional Forest Agreements negotiated between the Commonwealth and the States and Territories. However, the Bill includes a number of policy changes: it introduces the concept of compensation payable by the Commonwealth and requires that existing RFAs be re-visited; legislates to remove export controls from RFA forest operations and generally minimises the Commonwealth's role in forest management. It might have been appropriate to complete the revisions to existing RFAs before the legislation was introduced.

1. House Hansard, 15 July 1998, pp. 6091-6121.
2. Regional Forest Agreements Bill 1998, Second Reading Speech, op. cit., pp. 611-613.
3. National Forest Policy Statement. A new focus for Australia's forests, 1992, Commonwealth of Australia, 52 pp
4. Nationally Agreed Criteria for the Establishment of a Comprehensive, Adequate and Representative Reserve System for Forests in Australia. A report by the Joint ANZECC/MCFFA National Forest Policy Statement Implementation Sub-committee (The JANIS Report), January 1997, Glossary. Also at http://www.rfa.gov.au/documents/janis/contents.html
5. Ibid.
6. Ibid.
7. Tasmanian Regional Forest Agreement between the Commonwealth of Australia and the State of Tasmania, 8 November 1997 also at http://www.rfa.gov.au/rfa/tas/contents.html
8. Regional Forest Agreements Bill 1998, Explanatory Memorandum, p. 2.
9. East Gippsland Regional Forest Agreement signed between the Commonwealth
   and Victorian Governments, 3 February 1997 also at http://www.rfa.gov.au/cra/vic/eastgipp/rfa_kits/rfa_sign.html; Tasmanian Regional Forest Agreement between the Commonwealth of Australia and the State of Tasmania, 8 November 1997 also at http://www.rfa.gov.au/rfa/tas/contents.html; Central Highlands Regional Forest Agreement between the Commonwealth of Australia and the State of Victoria, 27 March 1998 also at http://www.rfa.gov.au/rfa/vic/cnhirfa.doc.
10. East Gippsland Forests, Weekly Senate Hansard, 25 March 1997, p. 2385. See also Jane Tribe, 'The Law of the Jungles: Regional Forest Agreements', Environmental and Planning Law Journal, Vol 15 No 2, April 1998, p. 141.
11. Andrew Darby, 'Forest agreements not legally binding: report'. The Age, 30 March 1998, p. A6.
12. Ibid.
13. Questions on Notice. East Gippsland, Tasmania and Central Highlands Regional Forest Agreements, Weekly Senate Hansard, 28 May 1998, p. 3437.
14. Regional Forest Agreements Bill 1998, Second Reading Speech, Mr Tuckey, House of Representatives, 26 November 1998, p. 612.
15. 'Timber workers call for Senate amendments', Press release, Construction, Forestry, Mining, and Energy Union, 23 August 1998.
16. Juliet Forsyth, 'Anarchy in the Forests: a Plethora of Rules, an Absence of Enforceability', Environmental and Planning Law Journal, Vol 15 No 5, October 1998, p. 340.
17. Ibid., p. 341.
18. Environment Protection and Biodiversity Conservation Bill 1998, Explanatory Memorandum, p. 6.
19. Regional Forest Agreements Bill 1998, Explanatory Memorandum, p. 5.
20. Tasmanian RFA, op. cit., p. 16.
21. (Chapter 2, Division 4, Subdivision C, clause 42)
22. Tasmanian RFA, op. cit.

Contact Officer and Copyright Details

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ISSN 1328-8091
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